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professionally involved with dramatic production for almost 40
years, and his interest in the activity can hardly be said to be
passing or casual.
The fourth factor, the expectation that assets used in the
activity will appreciate in value, sec. 1.183-2(b)(4), Income Tax
Regs., is not relevant here.
The fifth factor, the success of the taxpayer in carrying on
other similar or dissimilar activities, sec. 1.183-2(b)(5),
Income Tax Regs., seems largely neutral. While petitioner has
had a long and successful academic career in drama and has gained
recognition from several well-known theaters and universities, he
has not managed a truly profitable business activity.
The sixth factor, petitioner’s history of income or loss
from the activity, sec. 1.183-2(b)(6), Income Tax Regs., would
appear to bear heavily against petitioner, since he apparently
has never had a net gain from his playwriting. As noted in
Churchman, however, this is not decisive:
Such a history of losses is less persuasive in the art
field than it might be in other fields because the
archetypal ‘struggling artist’ must first achieve public
acclaim before her serious work will command a price
sufficient to provide her with a profit.
Churchman, 68 T.C. at 701-702. Further, under section 1.183-
2(a), Income Tax Regs., an activity may be found to be engaged in
for profit if there exists a “small chance of making a large
profit.” The example given in the regulations is of a wildcat
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